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GM will let Tennessee plant at Spring Hill idle; may make new car


GM will let Tennessee plant at Spring Hill idle; may make new car


By Richard Locker (Contact), Memphis Commercial Appeal

Monday, June 1, 2009

NASHVILLE — The news for General Motors’ sprawling Spring Hill, Tenn., auto assembly plant could have been worse: Instead of going "standby" late this year — idling all but 600 of the plant’s 2,500 workers — it could have been closed permanently under GM’s bankruptcy reorganization plan filed Monday.Now the question facing Spring Hill is how long the suspension of production there will last. That will depend on consumer demand for cars produced by the new, leaner GM.

Retired auto workers listen in their union hall in Spring Hill Monday as President Obama says his goal is to "help GM get back on its feet … and get out quickly."John PartipiloThe Tennessean

The Spring Hill plant, which produced Saturn cars and small SUVs from 1990 through 2007, may be in the running to build a new GM compact car.

"The only thing (GM president and CEO) Fritz Henderson said was, when there’s a demand for the cars, we’ll open the plant," Sen. Lamar Alexander, R-Tenn., said Monday after a conference call among members of Congress from the affected states and top GM executives.

"So taking Spring Hill from 600 employees to more employees means to have demand for new GM cars to be built there, and they don’t have that yet."

Both Alexander and Sen. Bob Corker, R-Tenn., expressed the same hope as United Auto Workers leaders in Spring Hill: that the recently retooled plant — one of GM’s most modern — will be too attractive for "the new General Motors" to shut down permanently.

Monday’s long-anticipated Chapter 11 bankruptcy filing is the latest stop in a roller-coaster ride for the Spring Hill plant that Tennessee won 24 years ago over 44 other states — and a particularly meaningful one for Alexander, who was governor when GM’s Saturn landed 35 miles south of Nashville.

"My personal feeling is very mixed," Alexander said during a press conference outside his Nashville office. "I’m sad to see the Saturn plant come in and go away. At the time it came, it was the most-sought-after plant in America. It was the largest U.S. capital investment in history, so they said.

"Every state wanted it. It really put Tennessee on the map. It said to the country: Saturn finally found a home in Spring Hill, Tennessee, and it asked (other corporations) the question: Why am I not there? If Saturn is there and Nissan is there, why am I somewhere else?"

That was July 1985. Only four years earlier, Nissan broke ground in nearby Smyrna, Tenn., for its first U.S. assembly plant. In the years since, Nissan has expanded its Smyrna facility and added a $600 million engine plant in Decherd, Tenn.

But after a hugely successful first decade after the first Saturn rolled off its new assembly line in 1990, the Spring Hill plant has been more of a mixed story than Nissan’s successful one nearby.

In 2004, Saturn’s UAW workers overwhelmingly scrapped their innovative Saturn-only contract with GM that gave Spring Hill much more flexibility — and the union more of a say in its operations — and joined the overall contract between the automaker and its largest union.

The next year, GM announced plans to close one of the two assembly lines in Spring Hill, idling up to 1,500 employees. And in late 2007, Spring Hill rolled its last Saturn off the line as the company moved production of the Saturn brand to Michigan and virtually shut down the Tennessee plant for 18 months to remodel the plant to build the Chevrolet Traverse, a small SUV.

"It’s the most efficient auto plant in North America, and I see no reason why the new GM can’t make a lot of money and make a lot of cars right here in Spring Hill," Alexander said.

"A number of plants are being closed. This one is going to be put on standby. To me, that means they’re likely in the future to be building cars here. (Henderson) didn’t say that. That will depend on demand, but they’re likely to in the future, in my opinion."

Corker agreed in a statement issued from his Washington office.

"I’m obviously very disappointed in the decision by GM officials and the administration to idle our Spring Hill plant, but glad it’s idled for a period and not closed, and certainly happy for the 600 Tennesseans that will remain employed. I’m saddened by the effect this will have on the many families who derive their incomes directly from the Spring Hill plant, as well as the suppliers and vendors who depend on it.

"Tennessee is one of the best places in America to build cars, and Spring Hill is one of the most modern, adaptable plants in the country, so we remain hopeful that Spring Hill might be chosen to house GM’s new subcompact facility or will move back into production if the economy improves," Corker said.

Alexander said he believes Tennessee’s huge roster of auto plant suppliers will survive the Spring Hill suspension because they generally supply more than one plant, but said it will be hard for some.

GM plans to ask permission in its Chapter 11 petition to pay suppliers all the bills it now owes.

"That will be a big help. And if the Chapter 11 reorganization is short term, the suppliers may be able to make it through that period of time. And these suppliers supply lots of people and locations. Denso in my hometown in Maryville supplies companies all over the Southeast. The reason we have hundreds of suppliers in Tennessee is because we now have 12 big assembly plants in the Southeast, and Saturn is only one of those plants."

— Richard Locker:

(615) 255- 4923

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